8 ms·

The European Startup Scene is Still Broken

34 points by jreacher 11y ago

throwaway45834 11y ago
there is no european startup scene* - if you are mark zuckerberg and building something that you intend to scale to every single person on earth, every single person you meet will look at you like you have two heads or something. europeans write essays like tihs - https://signalvnoise.com/posts/3972-reconsider https://signalvnoise.com/posts/3972-reconsider that is literally a european essay urging you to reconsider. * obviously they use the word, they just mean something different by it. i'm cmparing it with s.v.
- deleted 11y ago
  [deleted]
- pavlov 11y ago
  I find it only positive that there's a European startup scene that tries to do things differently from Silicon Valley. If you want to do the unicorn chasing thing, it makes sense to go to San Francisco. Places like Berlin, Madrid or Helsinki each need to have something unique to offer; there's no point in being a cheap imitation of the California dream.
  - ecthiender 11y ago
    Perfect. I think you nailed it. Posts claiming that European startup scene is bad is only looking for unicorn chasing. I just don't think it's a healthy, organic way of building a sustainable company. I think more startups should stop imitating the SV culture and come up with their own way of doing business.
- kuschku 11y ago
  Well, people often are more okay with slow growth. If you want explosive, unaffordable worldwide risky growth, Europe might just not be the right place.
gozo 11y ago
The problem I have with these kinds of comparisons is that they seem to compare with Silicon Valley and not European countries that overachive in terms of startup like, say, Sweden which isn't very close to SV culturally.
Kequc 11y ago
The title of this article is an understatement. I'm a startup founder in Europe and we've been treading water for a year. How is a company supposed to get off the ground if nobody has a hand that is able to be reached out to any of us. The government made it easier for startups to get loans from the bank. But they did it the same disastrous way as the housing market crash started. You can get a loan, the government takes a lot of the risk away from the bank. But you still have to pay it all back. All that means is that people are getting loans who shouldn't. There isn't even a path through immigration. You're much more likely to be able to stay in Europe if you get a job. Otherwise they just won't let you in. There aren't any investors here. When we look for investors, we have paid for tickets into large conferences and met leaders, owners, of Venture Capital organisations. There is a point where commonly they tell you after jumping through their hoops they do not have money. They say, we can give you 20k€ for x amount of equity where x is a two digit number. Everywhere you turn there are vultures, preying on startups. I get grilled by people promising to hook me up with investors all the time. People wearing business suits and trolling tech meetups only 5k€ for their help! They know people. Paid upfront. Taxes are higher if you own your own company than if you simply have a job somewhere. Every single thing works against you. If a year ago we were able to hit the market we had 0 competitors, now we have 2.
- Tomte 11y ago
  You can get a loan, [...]. But you still have to pay it all back. Nooooo! Really? You've got to be kidding me! So basically you don't want to create a profitable company, but living the cool "startup life" while getting a basic income from the state? That's... not how we usually see startups.
  - Kequc 11y ago
    You missed the point. In order to explain the point I need to repeat myself, as I went out of my way to explain the point in my original post. When loans are given out to people who shouldn't be getting loans, you bankrupt more of those people than you help.
  - deleted 11y ago
    [deleted]
mschuster91 11y ago
> Funding gaps remain larger in Europe than in the US. Well, of course. Engineers in the US take home five-figure sums each month, which explains why there are so many startups largely funded by ex-Google/Apple/MS/FB employees. In Germany, wages are so low, and taxes and rent so high, that you have to be either fucking good or fucking rich via inheritance to save enough money for your own startup. Not to mention that failure is expected and financed in the US startup culture, whereas in Europe you can't even get a small loan without putting your car/house/... as collateral, and you will get shunned for failure. Therefore, many capable people (have to) choose not to enter the start-up world.
- xamuel 11y ago
  It's basic Maslow's Hierarchy of Needs. You aren't gonna create the next big breakthrough if you're struggling to put food on the table.
  - logingone 11y ago
    Yes. Your head has limited bandwidth. Europe manages to fill your head with issues from the Victorian era, leaving no room for "luxurious" thought.
- pm90 11y ago
  That's an interesting point. I wonder if the reason why startup culture thrives so much is because a lot of the VC's/Investors are ex-engineers who made their wealth from their own companies... and there is a better understanding in SV of what it takes to succeed (and how to handle failure).
- deleted 11y ago
  [deleted]
  - RyanZAG 11y ago
    Something being possible doesn't necessarily mean it's not a problem. Nobody is saying it is impossible to have a startup in Europe -- there are startups in Europe, of course it is possible. The issue is that having a startup in Europe is far harder to start and harder to scale which means there are far less startups in Europe and to have a successful startup is a higher bar. If this still isn't clear, you can try comparing it to being a female tech founder in the 00s. It was possible and some people did it - but it was very challenging and there were more roadblocks making it difficult to succeed. Changing the culture a bit has already had an effect on this in the last couple years. Changing the European startup culture could create great gains there too.
benbrownww 11y ago
My experience running 2x startups in EU is that while lower salaries (esp Dev) helps at seed stage, in addition to government schemes like SEIS, scaling at SV pace is not possible without SV money. The best product in the world still needs consistent paid PR and advertising to acquire users - even viral growth needs a great social and content team to compete with a SV counterpart. These cannot be scaled cheaply. When the 1st round of EU unicorn founders sell out and start investing - then things will get interesting. Problem is - I don't have faith in many of the EU start ups being touted as unicorns, especially when I compare them to AirBnB, Dropbox, Stripe et al.
rwmj 11y ago
What are the factors stopping remote working in start-ups? It seems easier to address these than to force your hires to all move to a single place.
jokoon 11y ago
I'm french, and I even wonder if kickstarter is a decent opportunity for me. I'm not sure it is in term of finance law. France is pretty protectionist, and labor laws are also pretty tight. Maybe my personality is an issue, and maybe it's because I don't have a degree nor experience, but as someone who is able to read and write C, C++, java, PHP, when I hear that IT is a booming sector across the globe, I just can't believe I'm still unemployed. If you failed at school but went to programming classes and like programming, if you're not part of the top tier class of people who went to an engineering school, or managed to get through university, you're not employable. It's sad because I always hear that you don't need a degree to have a programming job. Well in france it's not really the case. Recently I even failed some government funded 1 year school program, where people learned programming (most of them never wrote code). I learned nothing, and the jury was patronizing and condescending for some reason which made me fail and not have this degree. Meanwhile, the pharma company I went to, which is doing molecular research for cancer treatments, was pretty happy about my intership. I guess something might be wrong with my attitude too, but I'm sure I know why countries like America have more success with IT, it is because they are liberal, and france is clearly not. I like france, but IT here is not so awesome.
- biokoda 11y ago
  Speaking as an employer (not in France though). What do you have to show me that you are capable? I place next to no value on formal education. But it will get you a foot in the door if you have no actual work experience. It at least tells me you can commit to something, even if it sucks (like most formal CS education). What I do care about is what you've worked on. If you have any personal projects to show me. No education, no projects that you have worked on tells me nothing about you. If there are 10 candidates waiting, you have very little chance of being picked. Someone with a history of open source contributions would be at the top of our candidate list.
  - jokoon 11y ago
    I have some downloadable exes on my website http://zonas.free.fr http://zonas.free.fr Also bitbucket.com/jokoon/eio and github.com/jokoon/eio Not really bright, but when I hear the "booming IT sector", I'm a little skeptic.
headmelted 11y ago
Can confirm that these are real problems (Belfast here). I'd disagree that there's any kind of local bump among Europeans from being in Europe. More often than not, I've found that being based in Europe only serves to put people off, even at home. I must admit that in the past I've outright skipped over new shiny apps and websites based in Europe (even if I believe in the idea) under the assumption that they'll just get crushed later by a US-based rival anyway, although I try to really give them a fair shake these days and not be an ass about it. The funding picture here is fairly anemic too, and relies quite heavily on government support. Most European governments have some public funding allocated to building their "own Silicon Valley", but their results from allocating funding is about what you would expect from people not well versed in the industry. I wrote about this recently as relates to losing Web Summit for silly reasons on Medium (same username). Don't want to direct link as I'm not trying to hijack the thread, people can check it out if they're interested. Thanks for writing this.
- danmaz74 11y ago
  > I must admit that in the past I've outright skipped over new shiny apps and websites based in Europe (even if I believe in the idea) under the assumption that they'll just get crushed later by a US-based rival anyway And this is one of our big problems in this space.
faloppad 11y ago
It's not like SV doesn't have any difficulties though (hiring, living costs, copycats etc). The main difference is the depth and failure tolerance of the home market. The number of early adopters is so much higher that it is much easier to take a product off the ground. In Europe you probably have to scale it country by country
gtpasqual 11y ago
>Talent is still localised. The European mobility is still low and employment laws are still strict on non-EU citizens This may be an acceptable argument for America, but makes no sense for Europe. I've seen great migration from high-unemployment EU places( Spain, Portugal and Italy) to UK, Germany and Switzerland. Finding talent in EU is much easier (and cheaper) than in the U.S.
- tianlins 11y ago
  I guess the point is flow of talent from outside Europe. For example, there are significantly more good engineers from Indian, Europe and East Asia moving to Silicon Valley.
SandB0x 11y ago
I believe London has co-opted (in the Naomi Klein sense) the US startup scene. We do all the superficial activity: incubators, pitches, hackathons, and so on, but it is driven by government initiatives and established businesses. - There are many copies of the US startup accelerators, but the people running them do not seem to have the same level of experience and connections as in the US. - Much of the activity is due to business students, both at bachelors level and MBA, who are somehow "trained" in "entrepreneurship". They "win" startup pitch competitions based on some slides and sales forecasts, then troll CS departments, alumni mailing lists and tech meetups looking for coders. I know this is an old stereotype (and that business skills are critical too) but it is very true here. - The government is often heavily involved. I wouldn't call myself a libertarian, but I think we would be better off without cringeworthy gov initiatives like "tech city", state-funded startups (https://interact.innovateuk.org/ https://interact.innovateuk.org/) and university entrepreneurship schemes that look a lot like a way to boost new grad employment figures. It all feels like a pale imitation of the US tech industry. Obviously there is some bias in terms of the US companies we hear about, but most people are thinking very small here. A few years ago a friend and I coded up an idea we had over a few weekends. It was more complex than a straight CRUD app and had some nice visualisations, but nothing too crazy. We met several "startup advisors" through our contacts and at meetups. Every time we finished describing our idea, people would ask us if we were having any luck "finding programmers" to implement it.
- jlangenauer 11y ago
  This reminds me of Australia's startup scene too: it's become something of a "game" with accelerators, advisors, incubators and even stranger things, often lead by people whose business experience (let alone tech startup experience) would be politely described as thin. It's definitely a case of form without content, and no-one should be surprised if the results from such an ecosystem are less than stellar.
- logingone 11y ago
  I've long considered London to be nothing more than a giant PR exercise. Of course the prime minister is an ex-PR guy, so a connection wouldn't be surprising. I'm not sure it delivers on the image it projects in any respect. Except the new trains that have started on some lines - nice to have room to breathe when you're stuck on a track waiting for a signal failure. Even the new double decker busses with the aero fronts. What's the real difference? Nothing. In fact the new appearance doesn't even last beyond the front of the bus which is what people see when it approaches - the rear of the busses is unchanged. So we don't have impressive new busses, we have busses that look, upon first glance, from a specific angle, as though they are. Everything is careful illusion. People buy into perception. Look! We have silicon roundabout! Seriously?

34 points by jreacher 11y ago

there is no european startup scene* - if you are mark zuckerberg and building something that you intend to scale to every single person on earth, every single person you meet will look at you like you have two heads or something. europeans write essays like tihs - https://signalvnoise.com/posts/3972-reconsider https://signalvnoise.com/posts/3972-reconsider that is literally a european essay urging you to reconsider. * obviously they use the word, they just mean something different by it. i'm cmparing it with s.v.

deleted 11y ago
[deleted]
pavlov 11y ago
I find it only positive that there's a European startup scene that tries to do things differently from Silicon Valley. If you want to do the unicorn chasing thing, it makes sense to go to San Francisco. Places like Berlin, Madrid or Helsinki each need to have something unique to offer; there's no point in being a cheap imitation of the California dream.
- ecthiender 11y ago
  Perfect. I think you nailed it. Posts claiming that European startup scene is bad is only looking for unicorn chasing. I just don't think it's a healthy, organic way of building a sustainable company. I think more startups should stop imitating the SV culture and come up with their own way of doing business.
kuschku 11y ago
Well, people often are more okay with slow growth. If you want explosive, unaffordable worldwide risky growth, Europe might just not be the right place.

gozo 11y ago

The problem I have with these kinds of comparisons is that they seem to compare with Silicon Valley and not European countries that overachive in terms of startup like, say, Sweden which isn't very close to SV culturally.

Kequc 11y ago

The title of this article is an understatement. I'm a startup founder in Europe and we've been treading water for a year. How is a company supposed to get off the ground if nobody has a hand that is able to be reached out to any of us. The government made it easier for startups to get loans from the bank. But they did it the same disastrous way as the housing market crash started. You can get a loan, the government takes a lot of the risk away from the bank. But you still have to pay it all back. All that means is that people are getting loans who shouldn't. There isn't even a path through immigration. You're much more likely to be able to stay in Europe if you get a job. Otherwise they just won't let you in. There aren't any investors here. When we look for investors, we have paid for tickets into large conferences and met leaders, owners, of Venture Capital organisations. There is a point where commonly they tell you after jumping through their hoops they do not have money. They say, we can give you 20k€ for x amount of equity where x is a two digit number. Everywhere you turn there are vultures, preying on startups. I get grilled by people promising to hook me up with investors all the time. People wearing business suits and trolling tech meetups only 5k€ for their help! They know people. Paid upfront. Taxes are higher if you own your own company than if you simply have a job somewhere. Every single thing works against you. If a year ago we were able to hit the market we had 0 competitors, now we have 2.

Tomte 11y ago
You can get a loan, [...]. But you still have to pay it all back. Nooooo! Really? You've got to be kidding me! So basically you don't want to create a profitable company, but living the cool "startup life" while getting a basic income from the state? That's... not how we usually see startups.
- Kequc 11y ago
  You missed the point. In order to explain the point I need to repeat myself, as I went out of my way to explain the point in my original post. When loans are given out to people who shouldn't be getting loans, you bankrupt more of those people than you help.
- deleted 11y ago
  [deleted]

mschuster91 11y ago

> Funding gaps remain larger in Europe than in the US. Well, of course. Engineers in the US take home five-figure sums each month, which explains why there are so many startups largely funded by ex-Google/Apple/MS/FB employees. In Germany, wages are so low, and taxes and rent so high, that you have to be either fucking good or fucking rich via inheritance to save enough money for your own startup. Not to mention that failure is expected and financed in the US startup culture, whereas in Europe you can't even get a small loan without putting your car/house/... as collateral, and you will get shunned for failure. Therefore, many capable people (have to) choose not to enter the start-up world.

xamuel 11y ago
It's basic Maslow's Hierarchy of Needs. You aren't gonna create the next big breakthrough if you're struggling to put food on the table.
- logingone 11y ago
  Yes. Your head has limited bandwidth. Europe manages to fill your head with issues from the Victorian era, leaving no room for "luxurious" thought.
pm90 11y ago
That's an interesting point. I wonder if the reason why startup culture thrives so much is because a lot of the VC's/Investors are ex-engineers who made their wealth from their own companies... and there is a better understanding in SV of what it takes to succeed (and how to handle failure).
deleted 11y ago
[deleted]
- RyanZAG 11y ago
  Something being possible doesn't necessarily mean it's not a problem. Nobody is saying it is impossible to have a startup in Europe -- there are startups in Europe, of course it is possible. The issue is that having a startup in Europe is far harder to start and harder to scale which means there are far less startups in Europe and to have a successful startup is a higher bar. If this still isn't clear, you can try comparing it to being a female tech founder in the 00s. It was possible and some people did it - but it was very challenging and there were more roadblocks making it difficult to succeed. Changing the culture a bit has already had an effect on this in the last couple years. Changing the European startup culture could create great gains there too.

benbrownww 11y ago

My experience running 2x startups in EU is that while lower salaries (esp Dev) helps at seed stage, in addition to government schemes like SEIS, scaling at SV pace is not possible without SV money. The best product in the world still needs consistent paid PR and advertising to acquire users - even viral growth needs a great social and content team to compete with a SV counterpart. These cannot be scaled cheaply. When the 1st round of EU unicorn founders sell out and start investing - then things will get interesting. Problem is - I don't have faith in many of the EU start ups being touted as unicorns, especially when I compare them to AirBnB, Dropbox, Stripe et al.

rwmj 11y ago

What are the factors stopping remote working in start-ups? It seems easier to address these than to force your hires to all move to a single place.

jokoon 11y ago

I'm french, and I even wonder if kickstarter is a decent opportunity for me. I'm not sure it is in term of finance law. France is pretty protectionist, and labor laws are also pretty tight. Maybe my personality is an issue, and maybe it's because I don't have a degree nor experience, but as someone who is able to read and write C, C++, java, PHP, when I hear that IT is a booming sector across the globe, I just can't believe I'm still unemployed. If you failed at school but went to programming classes and like programming, if you're not part of the top tier class of people who went to an engineering school, or managed to get through university, you're not employable. It's sad because I always hear that you don't need a degree to have a programming job. Well in france it's not really the case. Recently I even failed some government funded 1 year school program, where people learned programming (most of them never wrote code). I learned nothing, and the jury was patronizing and condescending for some reason which made me fail and not have this degree. Meanwhile, the pharma company I went to, which is doing molecular research for cancer treatments, was pretty happy about my intership. I guess something might be wrong with my attitude too, but I'm sure I know why countries like America have more success with IT, it is because they are liberal, and france is clearly not. I like france, but IT here is not so awesome.

biokoda 11y ago
Speaking as an employer (not in France though). What do you have to show me that you are capable? I place next to no value on formal education. But it will get you a foot in the door if you have no actual work experience. It at least tells me you can commit to something, even if it sucks (like most formal CS education). What I do care about is what you've worked on. If you have any personal projects to show me. No education, no projects that you have worked on tells me nothing about you. If there are 10 candidates waiting, you have very little chance of being picked. Someone with a history of open source contributions would be at the top of our candidate list.
- jokoon 11y ago
  I have some downloadable exes on my website http://zonas.free.fr http://zonas.free.fr Also bitbucket.com/jokoon/eio and github.com/jokoon/eio Not really bright, but when I hear the "booming IT sector", I'm a little skeptic.

headmelted 11y ago

Can confirm that these are real problems (Belfast here). I'd disagree that there's any kind of local bump among Europeans from being in Europe. More often than not, I've found that being based in Europe only serves to put people off, even at home. I must admit that in the past I've outright skipped over new shiny apps and websites based in Europe (even if I believe in the idea) under the assumption that they'll just get crushed later by a US-based rival anyway, although I try to really give them a fair shake these days and not be an ass about it. The funding picture here is fairly anemic too, and relies quite heavily on government support. Most European governments have some public funding allocated to building their "own Silicon Valley", but their results from allocating funding is about what you would expect from people not well versed in the industry. I wrote about this recently as relates to losing Web Summit for silly reasons on Medium (same username). Don't want to direct link as I'm not trying to hijack the thread, people can check it out if they're interested. Thanks for writing this.

danmaz74 11y ago
> I must admit that in the past I've outright skipped over new shiny apps and websites based in Europe (even if I believe in the idea) under the assumption that they'll just get crushed later by a US-based rival anyway And this is one of our big problems in this space.

faloppad 11y ago

It's not like SV doesn't have any difficulties though (hiring, living costs, copycats etc). The main difference is the depth and failure tolerance of the home market. The number of early adopters is so much higher that it is much easier to take a product off the ground. In Europe you probably have to scale it country by country

gtpasqual 11y ago

>Talent is still localised. The European mobility is still low and employment laws are still strict on non-EU citizens This may be an acceptable argument for America, but makes no sense for Europe. I've seen great migration from high-unemployment EU places( Spain, Portugal and Italy) to UK, Germany and Switzerland. Finding talent in EU is much easier (and cheaper) than in the U.S.

tianlins 11y ago
I guess the point is flow of talent from outside Europe. For example, there are significantly more good engineers from Indian, Europe and East Asia moving to Silicon Valley.

SandB0x 11y ago

I believe London has co-opted (in the Naomi Klein sense) the US startup scene. We do all the superficial activity: incubators, pitches, hackathons, and so on, but it is driven by government initiatives and established businesses. - There are many copies of the US startup accelerators, but the people running them do not seem to have the same level of experience and connections as in the US. - Much of the activity is due to business students, both at bachelors level and MBA, who are somehow "trained" in "entrepreneurship". They "win" startup pitch competitions based on some slides and sales forecasts, then troll CS departments, alumni mailing lists and tech meetups looking for coders. I know this is an old stereotype (and that business skills are critical too) but it is very true here. - The government is often heavily involved. I wouldn't call myself a libertarian, but I think we would be better off without cringeworthy gov initiatives like "tech city", state-funded startups (https://interact.innovateuk.org/ https://interact.innovateuk.org/) and university entrepreneurship schemes that look a lot like a way to boost new grad employment figures. It all feels like a pale imitation of the US tech industry. Obviously there is some bias in terms of the US companies we hear about, but most people are thinking very small here. A few years ago a friend and I coded up an idea we had over a few weekends. It was more complex than a straight CRUD app and had some nice visualisations, but nothing too crazy. We met several "startup advisors" through our contacts and at meetups. Every time we finished describing our idea, people would ask us if we were having any luck "finding programmers" to implement it.

jlangenauer 11y ago
This reminds me of Australia's startup scene too: it's become something of a "game" with accelerators, advisors, incubators and even stranger things, often lead by people whose business experience (let alone tech startup experience) would be politely described as thin. It's definitely a case of form without content, and no-one should be surprised if the results from such an ecosystem are less than stellar.
logingone 11y ago
I've long considered London to be nothing more than a giant PR exercise. Of course the prime minister is an ex-PR guy, so a connection wouldn't be surprising. I'm not sure it delivers on the image it projects in any respect. Except the new trains that have started on some lines - nice to have room to breathe when you're stuck on a track waiting for a signal failure. Even the new double decker busses with the aero fronts. What's the real difference? Nothing. In fact the new appearance doesn't even last beyond the front of the bus which is what people see when it approaches - the rear of the busses is unchanged. So we don't have impressive new busses, we have busses that look, upon first glance, from a specific angle, as though they are. Everything is careful illusion. People buy into perception. Look! We have silicon roundabout! Seriously?